Pet Adoption Accelerated in April – Positive for WOOF and IDXX
Some interesting snippets of information from Credit Suisse –
According to Pethealth Inc., a leading provider of management software to animal shelters in North America, YoY growth in pet adoptions across 1,202 Animal Welfare Organizations increased +6.6% in April, following a +3.0% rise in March and an +11.2% jump in February. By species, cat adoptions increased +6.7%, while canine adoptions increased +6.6%. The average price of a canine veterinary visit is typically 30% higher than a feline visit, and according to Pethealth, adoptions from animal shelters represent ~30% of new pet acquisitions.
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Animal Health read through: Pet adoptions and prescription trends can be indicators of overall pet demand and offer a barometer of performance for animal health companies, including Zoetis (23% of revenues US companion animal), IDEXX Laboratories, VCA, ABAXIS, PetMed Express, Aratana Therapeutics, and Nexvet Biopharma. Following supportive data points from industry constituents in recent weeks as compiled by Credit Suisse, along with the encouraging pet adoption trends noted above, both IDXX and WOOF should continue to benefit from strong US companion animal demand trends as leaders in the Dog’nostics market. Overall, the latest metrics suggest the robust utilization trends experienced over the past year are continuing in 2016.
Highlights from WOOF Q1 Earnings as released on April 27:
– Q1 EPS $0.66 vs. $0.61 estimate, beat
– Q1 Revenues $563M vs. $556M estimate, beat
– FY2016 EPS Guidance $2.87 vs. $2.78 estimate, beat
– FY2016 Revenue Guidance $2.4B vs. $2.39B estimate, beat
Highlights from IDXX Q1 Earnings as released on April 29:
– Q1 EPS $0.51 vs. $0.47 estimate, beat
– Q1 Revenues $417M vs. $403M estimate, beat
– FY2016 EPS Guidance $2.21 vs. $2.15 estimate, beat
– FY2016 Revenue Guidance $1.75B vs. $1.71B estimate, beat